Table of contents
More than one dependant
Contributions by another person
Invalid
relative
What is
separate net income
Income not included in SNI
What can reduce SNI
You can claim a tax offset for more than one dependant.
Your tax offset is reduced if:
- your dependant's separate net income was $286 or more
- you maintained your dependant for only part of the year
- another person helped to maintain your dependant, and/or
- your dependant resided in Australia for only part of the year.
Where another person or persons contributed to the
maintenance of your dependant, you can claim part of the allowable tax offset,
according to the extent of your contribution. For example, if you and another
person contributed equally to the maintenance of your dependant parent, you can
claim half of the allowable offset – that is, 50%.
An invalid relative is a person 16 years old or older who is
your child, brother or sister and who:
- receives a disability support pension or a special needs disability support pension,
- receives a rehabilitation allowance under the Social Security Act 1991 and immediately before
they were eligible to receive that allowance they were eligible for an invalid pension under that Act, or
- has a certificate from a Commonwealth approved doctor certifying a continuing inability to work.
The maximum tax offset is $792 for each dependent invalid relative and $1,583 for each dependent parent or spouse’s parent.
Separate net income (SNI) includes income and other specified amounts that
your dependant earned or received in the income year while you maintained
them. SNI earned by your dependant may affect any claim you are entitled to.
Income included in SNI:
- Salary and wages
- Termination payments representing unused annual leave and long
service leave
- Pensions, including Australian annuities and superannuation income streams
(other than any tax-free component shown on your dependant’s PAYG payment
summary –
superannuation income streams) and exempt pensions listed in the TaxPack. If
your dependant has not received a statement about their superannuation payment then
the fund paying the superannuation income stream will be able to tell them the gross
amount of the income stream and what proportion is the tax-free component.
- Interest and dividend income – but not the franking credit attached to franked dividends
- Business, trust and rental income
- Veterans’ Affairs payments and most Centrelink payments including
parenting payment (partnered), carer payment, remote area allowance and the
language, literacy and numeracy supplement
- Any net capital gain for the income year
- Any maintenance payments your spouse received for their own support
after divorce or separation – even though your spouse may not need to
declare such income on their tax return
- The maintenance or accommodation component of a scholarship paid
by the Commonwealth or a state, except where that component is paid for helping
to educate isolated children under 16 years old.
- the following Australian Government payments:
- baby bonus (formerly maternity payment)
- child care benefit
- child care tax rebate
- child disability assistance
- family tax benefit (FTB)
- maternity immunisation allowance
- carer allowance (but carer payments are included in SNI)
- the 2008 one-off payment to carers who received a carer payment,
wife pension, partner service pension, carer service pension or carer
allowance (paid under the Social Security Act 1991)
- payments to carers under the scheme determined under Schedule 4 to the
Social Security and Veterans’ Affairs Legislation Amendment (One-off Payments
and Other Budget Measures) Act 2008
- the 2008 one-off $500 payments to older Australians (paid under the
Social Security Act 1991 or the Veterans’ Entitlements Act 1986)
- payments to older Australians under a scheme determined under Schedule 2 to
the Social Security and Veterans Affairs Legislation Amendment (One-off Payments
and Other Budget Measures) Act 2008
- economic security strategy payment to families, back to school bonus and single
income family bonus paid under the A New Tax System (Family Assistance)
(Administration) Act 1999
- economic security strategy payment to families under the scheme determined under
Schedule 4 to the Social Security and Other Legislation Amendment (Economic
Security Strategy) Act
- training and learning bonus or farmers hardship bonus paid under the
Social Security Act 1991
- education entry payment supplement under the Social Security Act 1991
- payments under the scheme determined under Schedule 4 to the Household
Stimulus Package Act 2009
- the tax bonus paid under the Tax Bonus for Working Australians Act 2009
- the ex-gratia payment from the Commonwealth known as Income Recovery
Subsidy for the Victorian bushfires of January and February 2009
- the ex-gratia payment from the Commonwealth known as Income Recovery
Subsidy for the North Queensland floods of January and February 2009
- Baby bonus tax offset
- Franking credits attached to franked dividends.
- The value or amount of any non-government scholarship received in connection with the education
of a dependent child or student.
- The value or amount of any Commonwealth or state assistance provided for school
fees, the purchase of textbooks or travelling expenses.
- Lump sum severance or retirement payments of a capital nature or amounts paid as
compensation for losing a job, including the full amount of a genuine redundancy
payment or early retirement scheme payment
- Any maintenance payments your spouse received for support of their dependent
children
- Amounts received under the incentive payments scheme relating to certain private
health insurance policies
- Japanese internment compensation payments made under the Compensation
(Japanese Internment) Act 2001 or the Veterans’ Entitlements Act 1986
- Interest or other earnings credited to a first home saver account
- Government contributions credited to a first home saver account
In calculating separate net income (SNI), your dependant’s income can be reduced by:
- any expenses they incurred during the income year in earning their income and which
they could claim as a deduction
- net child care expenses they incurred during the income year because they were
working – that is, the amount paid by the dependant less any cash rebates (for
example, child care benefit and rebates provided by an employer or union)
- their expenses for travel during the income year to and from child care – because they were working.
- their expenses for travel during the income year to and from work.
- expenses they incurred during the income year in
conducting a business activity that resulted in a deferred non-commercial
business loss, even if they did not lodge a tax return.
Where any of the above expenses include car expenses, we accept a calculation of the expense
based on a rate per kilometre multiplied by the actual number of kilometres travelled - see
the ‘cents per kilometre’ method described in the
TaxPack.
If this method is used, the 5,000 kilometre limit does not apply for purpose of calculating
your dependant’s SNI.
Your dependant must be able to demonstrate that they actually incurred the expenses which
reduced their SNI.
What doesn’t reduce SNI?
Your dependant’s SNI cannot be reduced by:
- amounts they paid for gifts, donations or tax agent fees
- tax withheld, superannuation contributions or losses brought forward from earlier years
- self-education expenses that would not be tax-deductible because their only income was from
Austudy, Youth Allowance or work that was not connected with self-education
- a capital loss or net capital losses.
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